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Tesla shares slid on Monday as investors questioned whether the company needs to beef up its top leadership after Elon Musk ditched an earlier plan to take the company private.

Musk, Tesla's billionaire CEO, said Friday in a blog post that most shareholders wanted Tesla to remain public.

This week would also be an inopportune time for a capital raising, given that many bankers and investors are away ahead of the September 3 Labour Day holiday.

In morning trading Monday, Tesla Inc. was trading at $315.40, down $7.42, or 2.3 percent.

The Saudis were unhappy about Musk detailing his talks with the Kingdom's sovereign wealth fund in an August 13 blog post, where the CEO justified his earlier tweet about "funding secured" on their interest, the people said.

Several analysts suggested that Mr Musk could be replaced as chief executive or that a chief operating officer may be hired to support him. "While we are always looking for highly talented executives at Tesla, there is no active COO search", a Tesla spokesperson said in an email. Musk's plans for Tesla are reportedly being scrutinized by the SEC, especially in the "funding secured" part of his shock announcement on Twitter. At the time Musk only said that the funding was secured.

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New York Attorney General Barbara Underwood also vowed to sue the Environmental Protection Agency if the plan is approved. "We are putting our great coal miners back to work", declared the President at a rally in West Virginia this week.

Musk also indicated he was unaware how challenging the process would be and did not want to distract from the goal of ramping up production of the Model 3 sedan.

Investors in Tesla's bonds and convertible debt also had shown skepticism that the buyout would materialize during the days after that tweet, and a subsequent blog post in which Musk made a case for going private. Several investors have also sued Tesla, alleging that Musk's announcement was meant to manipulate the price of the company's stock.

This week would also be an inopportune time for a capital raising, given that many bankers and investors are away ahead of the September 3 Labor Day holiday.

The SEC investigation and investor lawsuits related to the whipsawing stock will at minimum continue to divert management's time from operations, Joel Levington, a senior credit analyst with Bloomberg Intelligence, said in a note Saturday.

Musk himself said in an interview that he is using sleeping drugs and working 120-hour weeks to boost production at Tesla.

Last year, Tesla announced it was producing an electric semi truck capable of carrying cargo across the country without burning any fossil fuels.


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